David Barger - Chief Executive officer, President, Director and Member of Airline Safety Committee Mark D. Powers - Chief Financial Officer and Executive Vice President Robin Hayes - Chief Commercial Officer and Executive Vice President

Hunter K. Keay - Wolfe Trahan & Co. Michael Linenberg - Deutsche Bank AG, Research Division Jamie N. Baker - JP Morgan Chase & Co, Research Division John D. Godyn - Morgan Stanley, Research Division Duane Pfennigwerth - Evercore Partners Inc., Research Division David E. Fintzen - Barclays Capital, Research Division Savanthi Syth - Raymond James & Associates, Inc., Research Division Kevin Crissey - UBS Investment Bank, Research Division Glenn D. Engel - BofA Merrill Lynch, Research Division Daniel McKenzie - The Buckingham Research Group Incorporated Helane R. Becker - Dahlman Rose & Company, LLC, Research Division Michael W. Derchin - CRT Capital Group LLC, Research Division Jeffrey A. Kauffman - Sterne Agee & Leach Inc., Research Division

Good morning, ladies and gentlemen, and welcome to the JetBlue Airways Fourth Quarter and Full Year 2012 Earnings Call. Today's call is being recorded. We have on the call today, Dave Barger, JetBlue's CEO; and Mark Powers, JetBlue's CFO. Also on the call for Q&A is Robin Hayes, JetBlue's Chief Commercial Officer. As a reminder, this call includes forward-looking statements about future events. Actual results may differ materially from those expressed in the forward-looking statements due to many factors, and therefore, investors should not place undue reliance on these statements. For additional information concerning factors that could cause results to differ from the forward-looking statements, please refer to the company's annual and periodic reports filed with the Securities and Exchange Commission. This call also references non-GAAP results. You can find the reconciliation of these non-GAAP results in JetBlue's earnings press release on the Investor Relations section of the company's website at jetblue.com. At this time, I would now like to turn the call over to Dave Barger. Please go ahead, Dave.

Thank you, John. Good morning, everyone, and thank you for joining us. Earlier today, we announced our 11th consecutive quarter and fourth consecutive year of profitability. For the full year, we increased net income by nearly 50% to $128 million, or $0.40 per diluted share. This represents our highest full year EPS since 2003 when you may recall oil averaged only $30 per barrel. This is in stark contrast to the 2012 average Brent price of $112 per barrel. Even with Hurricane Sandy, which reduced operating revenue by an estimated $45 million and operating income by $30 million, 2012 was one of the most profitable years in our company's history. We accomplished a great deal in 2012, including record revenues of nearly $5 billion, an increase of 11% year-over-year. While fuel remained at elevated prices throughout the year, we were able to fully offset the year-over-year increase of fuel costs with solid revenue performance, improving our full year operating margin from 7.1% in 2011 to 7.5% in 2012. Further, we continued to make significant improvements to the balance sheet. We generated healthy levels of cash from operations, which we used to pay down debt, purchased aircraft and repurchased shares. We prepaid over $200 million in debt and lowered our overall debt balance by $285 million, while maintaining a prudent level of cash and access to liquidity. We ended the year with approximately $730 million in unrestricted cash and short-term investments, or 15% of trailing 12 months revenue, and increased our available lines of credit to $325 million. I'm also pleased to report that in the fourth quarter, we repurchased approximately 4 million shares for $23 million through our share buyback program, largely offsetting the number of shares issued during the year in connection with equity-based crew member compensation. These results,…

Thanks, Dave. Good morning, everyone. Thank you again for joining us today. This morning, we reported fourth quarter operating income of $44 million, a decrease of $39 million compared to the fourth quarter of 2011. This year-over-year decline was driven primarily by, of course, Hurricane Sandy. Hurricane Sandy was certainly the headline for the fourth quarter, but hopefully, what is not lost is our solid revenue performance throughout 2012. Specifically, we generated nearly $5 billion in revenue and outperformed the A4A domestic industry average as measured by year-over-year present growth for the full year 2012. Even with 7.6% more capacity, full year yield was up 2% and load factor was up 1.4 points. We believe these results demonstrate the continued successful execution of our network strategy. East Coast short haul markets from Boston were the best performing region in our network as measured by year-over-year unit revenue growth. Of particular note, trailing 12-month margins in Boston have improved approximately 7 points year-over-year. Ancillary revenue continues to be an ongoing focus, helping drive 2012 record revenue performance. Total ancillary revenue in the fourth quarter was about $20 per passenger, and grew roughly $50 million, or 10% during the full year 2012 as compared to 2011. This increase was driven in large part by our Even More offering, which generated nearly $150 million of revenue in 2012. That's compared to $120 million in 2011. We expect our Even More offering to continue to be an important source of high-margin revenue and expect total ancillary revenues in 2013 to increase between 10% and 15% year-over-year. Turning to cost performance. Quarterly operating expenses increased 8.3%, or $87 million. Fuel comprises, of course, nearly 40% of the total. In the fourth quarter, we hedged 20% of our fuel consumption. In addition, we entered into fixed…

[Operator Instructions] And our first question is from Hunter Keay from Wolfe Trahan. Hunter K. Keay - Wolfe Trahan & Co.: A question maybe for Robin. Just curious how the interline agreement is going with American as it pertains to the non-contiguous terminals and, if you are to take this up, and I believe you said, one-way codeshares in your prepared remarks, Dave actually, but what would be the longer term solution with regard to sort of turning that thing up a notch given the fact that the terminals are non-contiguous, and I believe [indiscernible] passengers would have to go through security twice in some cases. How do you guys think about that?

It's Robin and thank you for the opening question there. I think, our partnership with American which currently is inter-line is an extremely important one. We appreciate it very much. In terms of the connecting experience at JFK, then clearly that is maybe slightly less convenient than maybe other airports where you have a more contiguous setup. But we haven't really found that to be an issue at all. At the end of the day, customers are pricing -- routings on price, schedule and convenience and a lot -- total elapsed journey time. And just because the richness of the schedules at JFK, it can be a very competitive offering. Hunter K. Keay - Wolfe Trahan & Co.: Okay. Thanks, Robin. And I guess a little more on the codeshare. How has that been trending? And over the last couple of years since you guys really put a focus on ramping up the partnerships? And can you help us quantify at all in terms of contribution whether as a revenue contribution or EPS or even sort of passengers carried and even maybe if you could just also -- I think this is math that I find very hard for a lot of investors to quantify. Give us a theoretical example of how you would account for this on your P&L, say a passenger traveling say on Lufthansa from say Munich to Rochester, with you guys carrying the passenger from JFK to Rochester, how does that flows to P&L?

Hunter, a couple of points there and I will try to attack them both briefly. And I do envisage us giving an update and a bit -- a little bit more color to this at the Analyst Event in March just as we did last March. We really look at -- we look at these flows, we started with interline. We have 5 one-way code relationships in place now. So we start with interline where there was a synergy and the reason for the partnership to develop beyond that to one-way code, that is something that we have done. In terms of how we account with them, in the essence goes into our flow in revenue. We are very particular about how we set these agreements up so that we are getting the equivalent of what we've sell a ticket for locally. So we are not looking at this business as a business that's lower yielding than what we could sell in a point-to-point market. That's very important for one of our core, sort of, principles and how we look at this. And then in terms of, it goes into kind of creating the overall demand, it strengthens demand and the market allows us to also yield up because this business tends to come in quite early, right part of the bookings [indiscernible], are bookings earlier so allows us to yield up. And then we assume as well an incremental factor in terms of how much of that is incremental versus how much maybe would have displaced the customer of very similar fare. And that's how we kind of model it through our internal processes here.

Next question is from Michael Linenberg from Deutsche Bank.

Just 2 questions here. When I look at your -- you gave the CapEx number, Mark. I think you'd said $695 million and I think you said that debt coming due is $395 million. That CapEx number, is that -- presumably, that's a gross number. How much of that are you going to potentially be financing and then how does that reconcile with the year-end number, I think you said cash 15% of LTM revenue?

Yes. So the per plan is -- that's actually an excellent question. We are projecting a pretty nice amount of cash from operations next year. I think the going-in assumption is that as we look at the F7 Embraers, they'll be financed using essentially Brazilian export financing. And the big question is what do we do with respect to the Airbus deliveries, which really don't start until July of next year anyway. So we have plenty of time to actually consider private bank debt and/or maybe something a little bit more exotic like a EETC to cover those deliveries. But I think the sort of going on treasury planning that we're doing right now assumes that much of that CapEx, particularly aircraft, will be covered with cash from operations. But you're absolutely right. We do have slightly higher debt payment obligations this year, but candidly I think we're in a pretty good position because we have a lot of options in terms of how we fund that.

Okay. Great. And before I ask my second question, I do want to thank you for providing the detail on the ROIC. I know I pushed you on that in the past. Much appreciated. Going to just to my next question, the 5.5% to 7.5% capacity growth for 2013, you gave us what Boston is going to be up 15%, Caribbean and Latin is going to be down 10%. If we look at some of the other major markets like Florida transcon, what are they? Sort of flattish or they even may be down a little bit? Can you put some numbers around that?

Michael, I think you said Latin America and Caribbean is down 10%. It's actually going to be up.

Yes, that's what I meant. I meant up 10%, Boston up 15%.

Yes, no. Those are 2 clearly our growth market. We haven't broken the rest out. But you should have hear me got everything in there from some parts of network will stay flat. Others will be going by a few percent and that will get you to the sort of 5.5% and 7.5% average.

Next question is from Jamie Baker from JPMorgan. Jamie N. Baker - JP Morgan Chase & Co, Research Division: Dave, have you been approached about potentially providing a regulatory solution to some of the issues that might be raised by a merger between U.S. Air and American particularly at DCA?

Really, as we talk about what may be happening there, we haven't been approached along those lines. So we'll see what plays in the future with both of those carriers, Jamie. Jamie N. Baker - JP Morgan Chase & Co, Research Division: Okay. Second quick question and then a third broader one, if I may. The 10% to 15% guidance for ancillary revenue growth, can you give us the 2012 baselines in some of the categories that fall between other revenue and passenger revenue?

So that's a 15% ancillary revenue growth baseline? Jamie N. Baker - JP Morgan Chase & Co, Research Division: Yes.

Yes, so obviously, the Even More offering -- I think, frankly, I'm looking at Mr. Hayes, who's not enthusiastically saying, "I don't think it's actually coming to its full flower." It's both the Even More space and Even More Speed, all but several -- a couple of airports now are equipped with the Even More Speed lines. That is supposedly bundled in a separate product. And I think a lot of revenue is going to come out of that. Candidly, we're also looking at some "pay-for-performance" structures, with some of our work groups, such that we certainly would expect a lot more effort behind selling that, candidly, very, very nice high-margin product. And then, of course, there's the full year impact of the new Mosaic program and other TrueBlue aspects. So I think they're going to be very, very important to ancillary revenue growth. Jamie N. Baker - JP Morgan Chase & Co, Research Division: And lastly for Dave, and now it's the sort of bigger picture question, when I think about the early years that the airline -- JetBlue was pretty innovative in its time, TVs at every seat, bringing humanity back to air travel, T5s design, certainly had some had innovative elements when it opened. Now I'm obviously pleased that the folks, in recent years, have shifted first to free cash flow and then more recently to ROIC. Those are the right priorities. My question, though, is whether we should still consider JetBlue an innovator. Trust me, it's good that you're thinking inside the box, okay, and folks -- but I am left wondering, if you have a deep enough bench to also be contemplating anything new and different that might kind of shake things up. It's fine if the answer is no, just curious to hear your thoughts.

Sure, and thank you, Jamie. There is -- when I look at the early days, by the way, the innovation that we rolled out, candidly, this is against the backdrop of an industry that, fundamentally, there was a real question regarding what the product, that was being offered. So you're right, we're somewhat pathfinding with TVs. And the answer is, you should absolutely think about us as an innovator, even though we are certainly financially driven, for example, as we talk about ROIC metrics. And I think the best example of that is, we've been, maybe criticize is the wrong term, but being a follower when it comes to WiFi as an example. And when I look at the current offering in that which we plan to start testing from an FAA, STC perspective here in the first quarter, with the broadband application and partners such as ViaSat, working with our LiveTV unit, and the ability to -- I mean, the speed, the weight of the cost, I mean, this is on paper, again, we move into testing here in Q1. This is incredibly innovative, and I think it's certainly going to be quite disruptive to the cabin experience. And -- so Jamie, when I think about WiFi -- by the way, we talked previously about that -- the initial installation being free to the customers. That's exciting, and I could talk about the ground experience, and the A321s, and what we're doing with partnerships and so on. But yes, you should absolutely think about us as certainly being an innovator and a disruptor in this industry.

Our next question is from John Godyn from Morgan Stanley.

Dave and Robin, I was hoping to follow up on the ASM guidance. I think last quarter, both of you mentioned that mid single-digits was kind of the right way to think about the ASM growth trend. Is that still the right multiyear, sort of ASM growth baseline? And when we think about 2013 and the fact that we're kind of in towards the higher end of that range, is there anything about sort of the unique opportunities of 2013 that drove that? If you could just elaborate a bit, I think that would be helpful.

Yes, no. Hi, yes. Thanks, John. I think you absolutely should still be thinking about that mid single-digit number in terms of a long-term projection. Mark touched on it in his comments, that when we look at the very, very positive trajectory we've seen in Boston and Puerto Rico, and Mark talked to how much operating margin we've seen in Boston in the last 12 months, which I'm going to be very candid, was beyond my expectation, and this is what I thought we could achieve, and the opportunity to bring forward some [indiscernible] that [indiscernible] incremental, just bring forward into this year, I think has afforded us some opportunities, that we wanted to take advantage of them. So just moving aircraft forward, clearly has had a bit of an impact this year. I also think our operating team have done a great job as we looked at the amount of resource we have, our spare count, the amount of turn time, ground time we have, and they've done a terrific job in putting aircraft time back into the system for this year, assets that we have that we're going to be sending as spares, that we're actually going to fly. And again, that's very accretive to ROIC earnings. So all of those have enabled us to get a growth plan this year, that's probably slightly ahead of what we expected, as we went into it.

I think one of the challenges that investors have is just getting comfortable with that level of ASM growth, just considering your near-term PRASM expectation seem to be underperforming CASM in a likelihood in the first quarter. I mean, how do you get confident that 2013 is the year of margin expansion?

I think we're very, very confident about that. We look at our ability to outperform the unit revenue performance last year, despite the additional capacity that we added in. I think we have demonstrated that we can do that, and that we will continue to do that. And I think that we're taking advantage of opportunities that are unprecedented. If we look at some of the competitive capacity reductions in markets like Boston, markets in Puerto Rico, these create tremendous opportunities for our brand to go in and grow margin. We look at what we've done with Boston. We look at how our market share through travel agencies, which frankly, isn't even our major form of distribution, is higher -- significantly higher in Boston than our seat share. All of these things, I think, lend -- certainly, make us feel that there is very good momentum behind our plan and our investors should be feeling very confident about that.

And John, I'd also offer, too, the -- we're attempting to be very transparent when it comes to talking about PRASM within our current guidance constructs into Q1. And you live in New York, I mean, all 3 of our airports were underwater, not that long ago. And then as we saw the demand softening in December and then, obviously, January a tough comp year-over-year. February, the schools around here -- and this is a big holiday for us, when you think about President's weekend. A lot of these days being made up across the Northeast, with schools still holding classes. And we did comment that we see some very nice strengthening over the course of Q1. So it's -- what we're really attempting to do is to be very transparent to shareholders regarding what we're seeing. And this is, again, half of our ASMs are in the New York area. Our airports were literally underwater in this storm. So it's a -- we feel very confident about 2013.

Okay. That's really helpful, Dave. And when it comes to your multiyear-point pre your ROIC improvement goal, are buybacks embedded in that plan at all?

No sir, they're not.

Our next question is from Duane Pfennigwerth from Evercore Partners.

We'll keep it on the ROIC theme here. I wanted to ask you a little bit about it as a management goal. To what extent has this changed your thinking and process for network planning? It feels like ROIC improvement has been unarticulated, at least to us, for about a year now. So my question is, in that year, how has this new goal changed the process by which you decide where to put new capacity?

Duane, it's actually -- I wouldn't say that this is just over the last year. I mean, as -- we've had 5 years worth of leadership team board off-sites because we talk about growing our business -- by the way, a young business when we're compared from an ROIC perspective, entering our 14th year versus many carriers, now let's see, 40 years old or even 80 years old, that we kind of get hung up against from an ROIC perspective. All that said, Duane, this framework is absolutely in place. It's in my performance goals. By the way, as we talk about cascading this into the organization, as we look at growing profitably but also improving ROIC, this is how we're building this company long term. And it is cascading from me to my group of direct reports, the exec leadership team, and into the organization, it's been very helpful. I think that Mark really helped a great deal, as we talk about slowing the growth back in 2007, and we think about CapEx and literally, the expenditures of CapEx slowing it down, moving to free cash flow, moving to ROIC. I think this is a healthy sign of a company that's maturing. But like Jamie's question earlier, we're still being very disruptive and innovative. And it's been very helpful to be a conduit, in which to think -- or a template, in which to think about how many airplanes we're going to be taking on a year-over-year basis.

Okay. And then just a follow-up, actually, on one of Jamie's questions, too. In terms of the other revenue line, specifically, I understand a lot of the good stuff you're doing on the ancillary side will flow through passenger revenue. I assume you had some cancellation givebacks here, and cancellation fee givebacks here in 4Q, how should we be thinking about the growth rate of that other revenue line into 2013?

Are you referring to, like change fees and things like that?

Yes, basically every part of your revenue that's non-passenger. So how should we be thinking about that growth rate into 2013? I think it leveled off here in the fourth quarter.

Yes, and I don't think -- well, we don't actually break that out as guidance that we provide.

We did look at -- we did anticipate a question that related to the $0.02 EPS versus consensus. Half of that actually did relate to change fees and the other half related to the loss we took on the prepayment of the 2 A320s, if that gives you a little bit of color.

Our next question is from David Fintzen from Barclays.

A question for Robin. You mentioned sort of Boston margins doing much better than you'd anticipated. Can you give us a little bit of context around where San Juan margins sit, and sort of, ultimately, where you see San Juan going? And is that a market you think can rival Boston? Just give a little flavor for how we should be thinking about that.

Sure. Thanks, David. I think San Juan is a couple of years behind Boston in the sort of investment phase. So I look at what we started doing in Boston back in 2009, 2010. In San Juan, the period of major capacity investments really started actually last year. This year, we will continue to grow that market, but it will grow at a lower pace than last year because we put a lot of capacity in, competitive capacity in San Juan. Puerto Rico continues to come down as we saw in Boston. And without making any specific sort of forecast, because that's not going to be sort of disclosed externally, but we believe that San Juan will, within a couple of years, start ramping up and provide a very nice return for JetBlue. It is a much smaller market than Boston, right? So as we talk about Boston being up to a sort of, probably about a 120 flights in the peak this summer, taking that up to 150 over the next 2 to 3 years, then San Juan is clearly a much smaller market than that.

Right. Now it makes sense. I appreciate that. And then, maybe a quick one for Mark. You mentioned maintenance unit cost up high single-digits. In terms of balancing that out to get to the nonfuel guidance for the year, is there any one line that sort of stands out in the P&L? Or is there just sort of less pressure around? And then in terms of sort of that high single-digit, you talked a little bit about sort of a leeway. I mean, how sort of dialed-in should we think about that maintenance guidance? How much room do you think you have to maneuver to bring that down?

I think that we are -- the whole Aveos thing is well behind us now, and we're looking forward to basically enjoying a full year of flight-hour agreements with a couple of our OEM and other partners, both on 2 engines, as well as in some maintenance caps on some potential E190 heavy checks, as, you may know, those plans are now getting to their C4 check range. And we have now those in place, and I think that we will continue to look for other ways to bend that cost curve down. But as I say, we're pretty pleased that we've been able, sort of on a year-over-year basis, to move that thing down from what had been 2 years ago at 38% year-over-year, to something far more reasonable. It will still obviously outpace ASM growth because the fleet is getting older, but it's certainly going to be a lot less than the stuff that we're talking about last year.

And just in terms of sort of the other side of the cost structure is there anything that stands out in airports or other areas, on a unit cost basis to sort of balance that? Or is it pretty much spread throughout the operation?

No, I think it's a great question, David, because I think this year, we're going to spend a lot of time internally focused on bending, in a very similar way, the cost curve on salaries and wages. We've already started to get a little bit ahead of that on some outsourcing opportunities, some opt-out opportunities and the like. We've also done a great job in terms of bending our cost curve on benefits, notably health care. But I think that this year is probably going to be a lot of discussion as we had on our MMNR [ph] last year. This year, we're going to have a lot of conversation about, internally, on the whole wage--bending that wage cost [indiscernible].

Our next question is from Savi Syth from Raymond James. Savanthi Syth - Raymond James & Associates, Inc., Research Division: Just on the -- a follow-up question on the cost side. I believe your pilot pay structure is based on an industry average, and we're starting to see a lot of large pay rate increases at the legacy carriers, anywhere from 20% to 60% over the next few years. And I just was wondering when that starts to impact your costs, and when will -- and what kind of an impact it might have?

Now we've always been committed to the proposition that our pilot wages are purely competitive. We are not unmindful of the fact that there are reports and -- of pilot shortages, occasioned simply, amongst other things, by the qualification -- higher qualification requirements, plus obviously, the military is producing a lot less in terms of numbers of pilots. And that is something that we are speaking to our pilot values committee and others about, as we move forward. And we're also not unmindful of what some of the legacy carriers have done with respect to their pay structures, keeping in mind, of course, that their demographics, if you lower the range of their population age and their relative seniority, are much, much different than ours. And as I say, we're -- we feel like we're in a pretty good position with the pilots today, and these are challenges that we're going to have to deal with. Savanthi Syth - Raymond James & Associates, Inc., Research Division: Okay, and if I may ask, regarding Virgin America, what's the overlap that you have with Virgin America? And I was just wondering if -- what the impact might be of them adopting a no-growth strategy here?

Yes, it's about 11% overlap. And I think if you look at the first quarter, there is an overall reduction in transcon capacity versus last year, and you certainly -- well, the industry is certainly seeing the benefits of that in just some of the fare environment.

And the next question is from Kevin Crissey from UBS.

You talked about the capacity growth being biggest in January. Can you give a -- the monthly rundown of what your capacity growth looks like as you go through Q1?

Kevin, so we don't break that out by quarter, but I think we touched on the fact that January is riding above what that average would be as we get into -- plus, I think we said earlier, it had a high comp. As we get into the rest of the quarter, then that is going to come down. So January is certainly the high-capacity month of the quarter.

Okay, and can you talk about whether you expect your RASM improvement to be more load factor or yield, as you look into the quarter?

As we look into the quarter, I think we touched on the January picture earlier. I think February has been a traditionally strong month for JetBlue. It is the, really, last hangover of Hurricane Sandy, in that many school districts have shortened or canceled holidays. And so that is going to impact the yield environment during the President's day, President's week holiday. And then as we get into March, I think we're going to see strength in both yield and in load factor. Because one, that is where Easter and Passover is sitting this year, another very strong period for JetBlue, but also what we're seeing is that where customers aren't taking trips over the President's day holiday, they are locking those in for the Eastern-Passover period. And so, we're seeing some nice early demand there as well.

Our next question is from Glenn Engel from Bank of America.

A few questions, one is Sharklets. Can you talk about when you'd expect them to be installed on all your plants?

That's a great question. It's -- we have a lot of flexibility to make it fast or make it slow, largely depending upon how much Mr. Hayes would like the capacity. It takes about 2 weeks when we retrofit the airplane to -- and it's a pretty big mod. So we have a lot of flexibility to go fast or go slow. Again, it's really a trade-off between out-of-service and revenue opportunities versus, obviously, the efficiencies of maybe having a couple of modification lines. We'll do 5 retrofits this year, and all of the aircraft from the Airbus that we'll bring this year will have the Sharklet. And probably, we'll be a little bit more specific in terms of the pace of those future mods, as we -- Jeff Martin and his team, sort of look at the whole maintenance cost/hangar schedules.

Do you have any outside date when you'd expect it to all be done? 2015, 2016, 2017?

I'm looking at -- probably '16 to '17. I'm looking at Mr. Barger and he's saying yes.

Okay. Second, if I look at your cost guidance in the first quarter, you're looking up 3% x fuel in profit share and up only 2% with profit share. You only had $3 million of profit share last year. So why does it have a full point impact on your CASM comps in the first quarter?

I don't actually -- I'm not giving you the same number, but we'll look at that off-line, that's not what I'm getting. We only had 3, we only had 3 full year last year.

In terms of the new definition.

That's right.

That's correct.

So it doesn't seem like it would have much of an impact on the negative side, but okay. Third question is, can you just give us operating cash flow and CapEx for 2012?

So we're looking at total -- 2012 CapEx was approximately $825 million. And from cash from operations, about $700 million.

So you did not hit your free cash flow target this year?

So no, we didn't. I think -- and I'll just -- and it's a great point. We have historically been pretty fanatical about free cash flow, and I actually had the same reservations sometime about mid-December, as we were looking at this prepayment opportunity that we had with Airbus, and I was reminded by our new Treasurer, Jim Leddy, at the time he said, "Don't let a useful financial metric get in the way of significant value creation." And that's precisely what the prepayment provided.

Our next question is from Dan McKenzie from Buckingham Research.

Can you talk about how corporate travel trends are shifting for JetBlue? I realize it's a pretty imperfect science, but, yes, what metrics are you looking at, and what are you seeing today that's different than, say, a year ago?

Thanks, Dan. I think that it's really a continuance of a process that we started a couple of years, centered in Boston, but not just in Boston. I mean, we do have corporate accounts across other parts of our network as well. When I -- what encourages me when I look at agency share data in Boston, I mentioned this earlier, and we are now sort of several points ahead of our sort of natural seat share, that's telling me that we kind of gone past that sort of sweet spot. We have a number of different format of corporate deals in place. We just made an investment, in fact, with a couple of additional account managers which is going to allow us to both process more deals and review our current deals more effectively than we have today, and they also focused on compliance. So I think phase 1 of this journey for us was, let's get the deals in place. And now phase 2 is OK we have to do it in place, but we need to make sure that they perform. And then we'll focus on the corporate customers that are driving that sort of incremental corporate business to us. And I think that together with the -- Mark touched on this, but the rollout of the new TrueBlue Mosaic program with a number of benefits for, sort of, our most loyal customers, that was important as well, because we had, in certain pockets, had some resistance from customers who were maybe [indiscernible] of other airline programs. We didn't something that allowed us to compete with that. So I think they're very JetBlue in a very innovative way. We created a program that was compelling and has been very attractive. And as we -- again, early days, but we are -- we've seen thousands and thousands of new customers come into that, since we launched it.

Okay, I appreciate that. And then if I could shift to a network question here. This past year, JetBlue has increased growth internationally out of Florida, and I'm wondering if you can provide some -- or just give us some perspective here, and how much further there is to go, perhaps this year? And then for the route, are there still significant international growth out of -- opportunities out of Florida, modest growth? I'm not sure what you -- I'm not sure what kind of color you can provide, but anything would be helpful.

Dan, now, I'm happy to answer that. I think that when we look, Latin America, and I kind of answered a question earlier from David and I kind of focused a bit too much, maybe on Puerto Rico as one of our focus cities. But when I look into Latin America and I look at the opportunities that we have down there and how quickly these routes ramp up into profitability, when I look at -- I mean, it's really rich. And we already announced, in the last couple of months, a new service from Fort Lauderdale-Hollywood into San Jose, Costa Rica, and also Medellin in Colombia. And we look and we see a significant amount of opportunity. And when we look at the South Florida catchment area, one of the real benefits of Fort Lauderdale-Hollywood is an airport with its low cost structure. We look at the cost of operating out of there, compared to, say, Miami, and it allows us to offer lower fares, stimulate the market and do all the things that we know work in terms of allowing JetBlue to come in and grow and be successful. And so, just as we talk about Boston and San Juan, we see a very, very lengthy and profitable ramp up to growth into the Latin America market, both in the Northeast, where we can fly, but also from South Florida catchment area in the Fort Lauderdale-Hollywood.

Our next question is from Helane Becker from Dahlman Rose. Helane R. Becker - Dahlman Rose & Company, LLC, Research Division: I just have a question about, like the -- I guess, it's like the thought process. You've got this new route to Medellin and I know you serve quite a lot of cities in Colombia now out of Fort Lauderdale. And I notice that aircraft seems to overnight there, and I'm just wondering if it doesn't make more sense to bring the aircraft or why you can't bring the aircraft back to overnight it in Fort Lauderdale? And is that not an inefficient way of operating that route?

Helane, now thanks for the question. We certainly have a mix down there, we have a number of daylight returns. But having a flight that departs late overnight and comes back in the morning, is as equally effective for aircraft time and also opens up the office customers there a choice of collections -- connections. If we look at Colombia, where we've been very successful, it's the point of some markets out of markets like Colombia, and things about the morning flight is very, very important. And again, as we build connectivity into our network, both into Fort Lauderdale, but also Orlando, the ability to offer a choice of time of day of departure for connecting customers, also very important for our network connectivity. Helane R. Becker - Dahlman Rose & Company, LLC, Research Division: Okay. And then in the Caribbean, I think you said that industry capacity would be down 7% in the first quarter? What will your capacity be like in the first quarter?

This is in San Juan? Helane R. Becker - Dahlman Rose & Company, LLC, Research Division: Yes. Thank you, I'm sorry.

Caribbean. I'm just trying to recall what we said on that earlier.

Yes, we said, Helane, the industry is down 7%, in San Juan specific, right? Then we also talk about our growth is up on an annual basis, as we're looking at something that looks like 15%. And we don't break it out by quarter, though, Helane. Helane R. Becker - Dahlman Rose & Company, LLC, Research Division: Okay. So can you -- and did you also say what percent share you have in the market?

Robin, [indiscernible] share?

Now we don't break that out, and also because we're so direct, so some of that is actually other parts of the measure.

Our next question is from Michael Derchin from CRT Capital Group.

A couple of quick questions. Most have been answered, obviously. The Sharklets. Have you given us a kind of a total financial return, when this thing is all completed for the firm? How much of these profits are going to be added, ultimately?

I haven't, largely because I'm not actually under the terms of our deal with the Airbus, entitled to disclose the purchase price of the Sharklet or the mod cost related to it. Again, I think the key factor right there, though, is that it is sort of uncertain, especially longer routes, easily a 3% good guide of fuel. And we're looking at a return on this thing of something a little bit north of 2, but not much north of 2 years.

Great. Thank you. And just on the ethnic market, you guys are doing a tremendous job there. Can you give us a little bit more color on it? Is that very seasonal? Is that year-round? And with the changes that are being contemplated in Washington on loosening up immigration and so on, how do you see that playing out for you?

Now thanks, Michael. I think in terms of sort of visiting-friends-and-family market, then it's seasonal to a degree. It's less seasonal than your sort of traditional leisure vacation markets. The other thing about the visiting-friends-and-family market is it can be stimulated in the trough. And so it is a market that responds if you have a tactical need to lower fares and stimulate demand. It responds well to that. And just a border comment, on maybe less about immigration and more about tourism, I mean, the more that we can, market the United States around the world as an inbound tourism destination, we look at the interest coming out of Colombia and other markets to visit here, so when they arrive, there is an efficient process of clearing customs' immigration. As they travel around the system, efficient security, I think all of these things are only helpful in terms of creating demand and improving things for the industry here. And mate, the last plug I give, in a couple of years here, less than a couple of years here, we'll have our P5I [ph] open, so we'll be able to land international flights into JFK and clear them in our own terminal, which will enhance our customers' experience.

And we have a question from Jeff Kauffman from Sterne Agee. Jeffrey A. Kauffman - Sterne Agee & Leach Inc., Research Division: A lot of my questions have been answered, so Mark, let me just throw out a brief one. $55 million in CapEx for LiveTV, I'm sure you'll talk about it in Investor Day, but can you give us an update on kind of how big LiveTV is, and is it generating any kind of meaningful contribution yet? And where are you looking this capital spend to be and kind of the revenue base to be over the next year or 2?

So Jeff, I'll only talk about it, [indiscernible], if like last year you sit in the front row. Candidly, from an SEC perspective LiveTV is still not material to our results, so probably it's not really worth breaking out. I just think, though, that we will highlight LiveTV because it really is the engine by which we're going to implement these innovations of KA-band. So I think, just a little bit -- just to plug for Analyst Day, we will actually try to demonstrate a little bit of the capabilities of KA-band. And again, well, the $55 million of CapEx is seemingly a big number. A lot of it really is, essentially, monies that LiveTV gets back in the form of fees and whatnot from its own customers, as it installs LiveTV and whatnot on other air lineage, including JetBlue's aircraft. But I think the real story behind LiveTV, again, it's not material, it's not worth to separately breaking out, but it is really one of those engines, going back to Jamie's first question on innovation, that really helps us and enables us drive and take an innovative lead in this space.

And we have no further questions at this time.

Great. Thank so much, John. I appreciate that. Let me just close this call by, once again, thanking our crew members over the course of 2012. Again, we're very pleased with the results of 2012. We're very excited about 2013. We look forward to seeing many of you at Analyst Day, again, in the March time frame. Thanks for calling in today. We appreciate it.

Thank you, ladies and gentlemen. This concludes today's call. Thank you for participating. You may all disconnect at this time.